EU Opens Consultation on Pan-European Demand Response Network Code

November 1, 2025

Europe’s wind and solar rollout is outpacing grid upgrades, so grid operators now pay factories and cold‑stores to treat electricity like another raw material. A draft EU Network Code on Demand Response, submitted by ACER in March and scheduled for adoption later this year, will standardise measurement and settlement rules so any flexible kilowatt can trade across borders. Analysts expect the framework to unlock a market worth about $21 billion by 2027 as automation squeezes curtailment costs below batteries. Because it leverages assets that already exist, the rulebook could turn every chilled warehouse, desalination pump or EV charger into a tradable resource.

Octopus Agile Leads the Consumer Charge

Retail suppliers are proving the concept at smaller scales. Octopus Energy’s Agile tariff exposes more than 160 000 UK homes and businesses to half‑hourly wholesale prices; when wind output soars and rates plunge below zero, the company’s API nudges dishwashers, heat pumps and even small commercial chillers to soak up surplus electrons. The anonymised load‑shaping data flows back to system operators, sharpening day‑ahead forecasts and showing how granular price signals can cascade into grid‑level relief.

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Utility Companies Role as Aggregators

Utilities remain the largest aggregators. Enel X orchestrates over 9 GW of curtailable demand in eighteen countries and, in Britain’s March 2025 T‑1 capacity auction, captured 180 MW at £20 kW‑year—a rate that delivers payback to a refrigerated warehouse in under three years. Centrica Business Solutions controls around 2 GW after absorbing Belgium’s REstore, while ENGIE and E.ON bundle demand flexibility into multi‑year supply contracts that hedge clients against volatile wholesale markets.

The Intelligent Grid

Industrial‑automation giants are wiring those megawatts together. Siemens couples its Distributed Energy Resource Management System with EnergyHub’s forecasting to give second‑by‑second visibility of plant loads. Schneider Electric’s EcoStruxure, boosted by its 2022 AutoGrid acquisition, lets a single dashboard throttle heat pumps, EV chargers and grid‑scale batteries. ABB’s OPTIMAX® and Honeywell’s Forge perform similar tricks, proving that software fluent in both process constraints and market prices can unlock double‑digit savings. Siemens estimates that digital twins of large food‑processing plants reveal an extra 8 % of flexible load without retrofit hardware.

Specialist firms are attacking niche loads. Nuvve turns an electric‑bus depot into a 5 MW virtual power plant by discharging parked vehicles. Generac’s OmniMetrix enrols standby generators so factories can island themselves when prices spike. Itron, born in smart metering, automates thermostat tweaks and pump cycling at thousands of smaller sites, stacking kilowatt blocks into gigawatt response.

Battery energy storage systems (BESS) complement demand response, charging when renewable output is high and discharging during peak demand. Yet curtailing consumption still undercuts storage on cost wherever flexibility exists, avoiding new steel in the ground and turning electricity bills into revenue lines. With Europe targeting 70 % renewable electricity by 2030, the cheapest clean megawatt may be the one a factory agrees not to use for twenty minutes. Demand flexibility—once a footnote—is fast becoming the grid’s preferred shock absorber and a growth story that engineers and investors can both bank on.

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